Parliament: Labour to privatise membership service

NEW LABOUR is about to embark on the ultimate privatisation. The party is preparing to call in the private sector to recruit, retain and service its 390,000 members.

To the anger of left-wingers and trade unionists, the Blairites who run Labour's Millbank headquarters in London have won approval for the party's membership system to be contracted out to a private company.

Pete Willsman, a left-wing member of Labour's national executive committee, raised with horror the prospect that Tory activists employed by an outside contractor could handle Labour's membership activities.

But despite left-wing criticism, the NEC agreed by 20 votes to four to commission a feasibility study into contracting out the work and boost Labour's recruitment effort.

In a confidential report, Margaret McDonagh, Labour's ultra-Blairite general secretary, told the NEC the party had blazed a trail in 1988 by becoming the first in Britain to set up a centralised membership service. Before that, Labour HQ did not even know how many members it had or how to contact them.

"Whilst acknowledging the success of centralising the records, it is recognised that the system we now have is slow, unwieldy and unreliable," Ms McDonagh said.

The report, leaked to The Independent, said the challenge for Labour was to provide a "quality membership service" and action was needed now to put it in place for the build up to the next general election.

Payments to the private firm that wins the contract would be met from a pounds 4m increase in Labour's budget this year.